The Atlanta Way

As the US Supreme Court considers an affirmative action case in the current session I am reminded that Atlanta leaders have been determined to act lawfully but boldly to include African Americans, Latinos, Asian Americans, women and small businesses even when the odds were stacked against them. In fact, Atlanta is known across the country and world for its minority contracting initiatives. This includes the construction of MARTA in the 1970’s, Olympic venues in the 1990’s, and Hartsfield-Jackson Atlanta International Airport for over three decades.

Some well-known Atlanta champions of these contracting programs were former Northside City Council members like Richard Guthman and Barbara Asher and former mayors Sam Massell, Maynard Jackson and Andrew Young. Each generation of leaders has weighed the political and legal consequences of such programs. Many administrations faced court challenges, sometimes even at the federal level. In their own way these champions challenged the status quo which excluded minorities, women and small businesses from equal economic business opportunities.

Without minority contracting programs Atlanta would not be the city it is today.  Generations of businesses and businesspeople demonstrate the success of the programs here.  The Atlanta model for economic diversity became the blueprint for many other places including the federal government.  While the members of the US Supreme Court weigh the merits of this affirmative action suit from Texas, they ought to be cognizant of Atlanta and the others places where affirmative action has succeeded and not just default to their usual conservative or liberal stances as explained in Jeneba Ghatt’s blog post  “Affirmative Action Apocalypse?”

Comments

  1. Burroughston Broch says:

    BWB illustrated the only the upside.
    The downside is that the City’s affirmative action procurement policies substantially increase the City’s costs. This may be all well and good when the City’s coffers are full, the future looks rosy, and the politicians are preening their feathers. Unfortunately, these increased costs must be also paid during bad times like the present. It’s not all sweetness and light.
    I believe that the City’s taxpayers would be better served by eliminating these programs and concentrating on getting top value for the taxpayer’s money.

  2. bloggingwhileblue says:

    Hey, how do you like the new site?

    According to the city’s website, minority, women, and small owned business earned almost $400 million from city contracts in FY 2011. I couldn’t find an exact number, but I estimate the city spent < $5 million to ensure economic diversity in its contracting. That seems like a small price to pay to be a leader in the field of municipal economic diversity given the city’s total operating budget for FY2011 was $1.6 billion.

    • Burroughston Broch says:

      I like the new site – it’s visually simpler and easy on the eyes. Well done.

      As to the cost of affirmative action procurement, let me offer some first and second hand experience.
      First hand experience. My company does not qualify as an MWDBE company and we are performing a contract for an industry client who requires a minimum of 5% participation. We normally would self-perform all of the work in-house except printing. We are using an MBE printer whose prices are 20% higher than we normally pay. We subcontracted 10% of our work to a WBE firm and are reviewing their work. Our costs on those portions of the job so far are 20% higher than normal. Our client will end up paying about $80,000 more on a $4million contract – that’s 2%.

      Second hand experience. I know a lot of large building contractors who work or have worked for the City. I have canvassed a number of them about the impact of the City’s affirmative action procurement on their business. They all estimate that their bids are increased between 5% and 15% on every project. If we assume only 5% premium, that is a lot of potential savings for hard-pressed taxpayers.

  3. bloggingwhileblue says:

    That’s an interesting take on the cost of the program. I assumed the subs prices would and should be competitive. If what you are saying is true then I agree those inefficiencies should be fixed. A major part of the program is that minority, women, and small businesses should be able to compete with larger businesses if given the chance.

    Cabral

    • Burroughston Broch says:

      Cabral, there are always people focused on gaming the system. One game is that a contractor buys supplies from a certified minority supplier. The minority supplier doesn’t fill the order from his stock (if he even has any). Instead, the minority supplier calls a big supplier who fills the order at the normal price. Then, the big supplier sends the minority supplier a bill, which the minority supplier marks up 10% or more for laundering it through his business. The minority supplier then bills the contractor at the inflated price. It all looks good on paper.

      The above is just the tip of the iceberg.